^{Source: www.southgobi.com  Date: 26 March, 2010}

Among the developments highlighted by SouthGobi Energy Resources Ltd. in its recently announced financial results for the year ended December 31, 2009 are:

-- Sale of approximately 1,330,000 tons of coal from the Ovoot Tolgoi mine.

-- Determination of 114.1 million tons of proven and probable surface coal reserves at Ovoot Tolgoi based on open-pit mine study independently prepared by Norwest.

-- Establishment of Initial National Instrument 43-101 compliant coal resources for Soumber, a new deposit about 20 km to the east of Ovoot Tolgoi. The Soumber central field resources consist of measured coal resources of 13.1 million tons, indicated coal resources of 8.3 million tons and inferred coal resources of 55.5 million tons. The deposit has potential to increase coal resources to the east and to the west, as well as at depth.

The deposit likely will be able to share common infrastructure with the Ovoot Tolgoi mine. SouthGobi has initiated mine planning and will submit an application for a mining license for development of this project.
-- Completion of USD500-million convertible debenture financing by China Investment
Corporation (CIC) to support major expansion of the company's coal mining and exploration in southern Mongolia.
-- Listing of SouthGobi on the main board of the Toronto Stock Exchange.
Subsequently, in January 2010, SouthGobi completed a global equity offering of 27 million common shares at a price of CAD17.00 per share for gross proceeds of CAD459 million. The shares are traded on the Main Board of the Hong Kong Stock Exchange.
On March 12, 2010, the company announced, subject to regulatory approval, a formal request for CIC to convert USD250 million of its convertible debenture into common shares of the company.

Lower production in 2009 was the result of the full mine shut-down from March 2009 to July 2009 due to difficulty expediting the movement of coal shipments through the Mongolia-China border crossing and the re-configuring of the pit which began in December 2009. In June, the border crossing check point started operating 11 hours per day, six days per week. In July 2009, Mongolian and Chinese officials met at the Mongolian-Chinese border and allocated designated gates for coal exports to create an expedited coal border crossing corridor. With increasing sales and a reduction in its coal inventory, the company resumed full mining operations effective July 1, 2009 on a 24 hour per day, seven day per week basis.

The Company's total assets at the end of 2009 were USD560.7 million compared with USD99.9 million at the end of 2008. Its long term liabilities at the end of 2009 were USD543.1 million compared with USD0.3 million at the end of 2008.